Canada Post strike highlights mail's fading role

Fri Jun 10, 2011 12:21pm EDT
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By Allan Dowd

VANCOUVER (Reuters) - A rolling postal strike, followed by deep service cuts, has highlighted the fading role of Canada's mail service in the age of the Internet, with neither side likely to end up ahead.

On one side of the dispute are postal workers who are looking for higher wages and more job security -- saying the company is ignoring their ideas to modernize as consumers increasingly pay bills online and use e-mail for letters.

On the other is Canada Post, which, in addition to seeing declining demand, faces what the company says is a yawning C$3.2 billion deficit in its pension system, at a time when more than a third of its workers are within 10 years of retirement.

"The pie they are trying to cut up is already shrinking," said George Smith, who teaches at Queen's University and is a veteran of labor negotiations in the railway and broadcast industries.

Smith said the limited action so far indicates the sides know they will both get hurt if the postal service shuts down entirely and the public does not care.

The unionized postal workers started their industrial action last week, staging 24-hour rotating strikes in different parts of the country to press their demands.

The independent, government-owned corporation responded by idling workers and reducing urban delivery to three days a week. It says mail volumes are down 50 percent since the strike began and the workers' demands will doom the company.

Canada Post, which traces its roots to the country's founding, reported a C$319 million profit last year on revenue of C$6.1 billion.   Continued...

<p>Canadian Union of Postal Workers president Denis Lemelin speaks during a news conference in Ottawa June 3, 2011. REUTERS/Chris Wattie</p>